The free-rider problem makes a good highly proﬁtable for a private ﬁrm to provide.

Name: The free-rider problem makes a good highly proﬁtable for a private ﬁrm to provide.
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Question

Quizplus · Accepted Answer

The free-rider problem occurs when individuals can benefit from a good or service without paying for it, which makes it difficult for private firms to profit since they cannot easily exclude non-payers. This often leads to under-provision of such goods or services by the private sector.

The Free-Rider Problem Makes a Good Highly Proﬁtable for a Private